[blomsky]

Are you saying a plane is supposed to float like that?

Well, not really. But AFAIK the 3D model is contructed in segments. The wing for example is divided in inner, middle, outer section. That is why You can shoot it into pieces, that can break apart from the rest of the wing. The fuselage is constructed the same way, which can lead to a situation where the tail gets separated from the rest. So far so good.
If You would just do a proper 'cut' of some part of an aircraft due to battle damage that this would look rather unrealistic. So You can add some bend pieces here and there as can be seen on the P-51 behind the cockpit section. This piece of bend metal was not added to the 3D model of the plane when the tail was cut of. It has been already there when the plane was intact. The null material now is used to smooth the transition from one section to another and to enable these section overlapping effects. Therefore, in the damage model, to every visible section the designer adds all neighboring (invisible) sections. Which would result in something that can be seen in the video.

I am not a 3D modeller, so please forgive me that I'm not able to give a better explanation.

So, to answer Your question, this is surely not WAD (works as desired). But it is also not supposed to taxi around with an aircraft that has been sliced to pieces and wonder why it behaves so crappy.